Gold slips as oil strength, interest rate worries dampen appeal

Synopsis

Gold prices dipped for a second week, pressured by escalating oil costs and growing inflation worries. Concerns over potential interest rate hikes by the U.S. Federal Reserve, fueled by a resilient job market and ongoing geopolitical tensions, are impacting the precious metal. Investors are closely watching economic indicators and international developments.

Gold edged lower on Friday, on track for its second consecutive weekly loss, as higher oil prices and rising concerns around inflation and hawkish interest rates weighed on the metal.

FUNDAMENTALS

* Spot gold was down 0.2% at $4,534.29 per ounce by 0047 GMT. The metal was ‌down about ⁠0.1% for ⁠the week so far.

* U.S. gold futures for June delivery lost 0.1% to $4,535.60.

* U.S. Secretary of State Marco Rubio said there had been "some good signs" in talks with Iran, although Tehran's uranium stockpile and control over the Strait of Hormuz remained sticking points.

* U.S. crude futures rose more than $1 in ⁠early trade ‌on Friday as investors doubted the prospects of a breakthrough in peace talks. [O/R]

* How businesses and consumers ⁠respond to ongoing economic shocks will determine if the U.S. Federal Reserve can "look through" current high inflation or needs to consider raising interest rates, Richmond Fed President Thomas Barkin said on Thursday.

* Data showed that the number of Americans filing claims for unemployment benefits fell last week, pointing to labor market resilience and giving the ‌Fed room to focus on surging inflation from the war with Iran.

* Markets are pricing in a Fed rate hike before ⁠year-end, with a 60% chance of a move by December, according to CME Group's FedWatch tool. [FEDWATCH]

* Spot silver fell 0.5% to $76.32 per ounce, platinum lost 0.3% to $1,959.20, and palladium was steady at $1,377.89.

DATA/EVENTS (GMT)

0600 Germany GDP Detailed QQ SA Q1

0600 Germany GDP Detailed YY NSA Q1

0600 UK Retail Sales MM, Ex-fuel MM, YY Apr

0645 France Business Climate Mfg, Overall May

1400 US U Mich Sentiment Final May

...moreless

...moreless